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One of the many cliches about the stock market is that it's never wrong. Today's triple-digit rise in the Dow Jones Industrial Average shows that markets can be depressed, manic or just pain stupid, sometimes all at the same time.

The depressed part comes from the housing market. Thinking about Fannie Mae (NYSE: FNM), which today slashed its dividend and posted awful results, and Freddie Mac (NYSE: FRE), which posted terrible results and ignored signs that things were going sour, would have been enough to drive the late Dr. Norman Vincent Peale of the "Power of Positive Thinking" fame to drink.

There is no sign that the market has hit bottom. Garage sales are mushrooming in my suburban community as people sell their personal possessions to raise cash. It's really sad.

Mania set in today as investors start to wonder whether lowering commodity prices will give the economy a jolt. Remember that no car or truck was designed with oil over $100 a barrel in mind. The fact that oil is only slightly less insanely high should give no solace to anyone. Fuel got so expensive that people started driving less and began snapping up pint-size Smart Cars, which look to me as safe as a Matchbox car. This is a sign that things are bad -- not that they will improve. Mind you, the smallest wiff of political instability and oil prices will start climbing yet again.

People seem to think that the economy is going to get better through some magic elixir of a second economic stimulus package and drilling for oil. Those ideas are not only stupid, they are dangerous. Unfortunately, quick fixes are not the answer. We have to let the market sort things out. About the best the government can do is figure out a way to cushion the blow.

Stock futures were trading down as Fannie Mae posted its fourth straight quarterly loss. Investors were awaiting word from a government report on worker productivity to see if there is any sign of an economic rebound. Those figures, though, proved disappointing.

Bloomberg News reported that worker productivity in the U.S. grew at a lower-than-expected rate in the second quarter as employers cut jobs to weather the jump in raw-material expenses. "Employers eliminated 165,000 jobs from April through June to shore up profits, and still managed to get more output with fewer workers," the news service says. "Gains in productivity help lower inflation and bolster the Federal Reserve's forecast that prices will moderate."

Fannie Mae (NYSE: FNM) posted its fourth straight quarterly loss and slashed its dividend. The second-quarter net loss was $2.3 billion, or $2.54 a share. Excluding one-time items, the loss was $2.51 a share, compared with the 72-cent average estimate of 10 analysts in a Bloomberg survey. Shares tumbled more than 12% in pre-market trading.

Toyota Motor Corp. (NYSE: TM) and Wal-Mart Stores Inc. (NYSE: WMT) today showed yet again that the economy remains deeply troubled.

The automaker reported July sales of 197,424 vehicles, down 18.7% from last year. Monthly Lexus sales dropped 24.6% to 22,182. Passenger vehicle sales fell 5.4% despite a strong showing from its hybrids and other fuel-efficient models such as the Corolla. Not surprisingly, light truck sales slumped 34.3%.

As the Wall Street Journal noted, "The weak results are a rare setback for Toyota, whose rapid expansion in sales and profit growth this decade once appeared to be immune to hardships facing other auto makers." The Big Three automakers, though, would give their left arms for results that were as "bad" as Toyota's.

Meanwhile, Wal-Mart and other discount stores are continuing to reap the benefits of the stimulus checks. The company's flagship stores reported same-store sales, excluding fuel, rose 3%, while Sam's Club grew 3.5%. Wal-Mart, which had forecast sales growth of between 2% and 4% in July when it raised its fiscal second-quarter outlook, sees growth tapering off in August to 1% to 2%.

"With the end of the stimulus checks, we know consumers are spending more cautiously,and we continue to see a pronounced paycheck cycle at the end of the month," said Eduardo Castro-Wright, Wal-Mart US President, in a statement.

The question for policymakers is whether having a second stimulus bill will give companies such as Toyota and Wal-Mart a boost to their bottom line. I have to wonder whether a new government handout is needed given that the first one did not do as much good as many had expected.

Then, what happens next? A third stimulus bill? A fourth one?

"Shawn Hebb may have one of America's toughest jobs: convincing people that Whole Foods Market Inc. (NASDAQ: WFMI) can be an economical place to shop," according to The New York Times. I would beg to disagree. His job is the toughest, even harder than John McCain's campaign manager or Michael Vick's PR consultant.

Hebb is the guy who gives tours of America's most uptight grocery chain to convince shoppers that they do not necessarily need to spend $10 for an apple. How bad are things at Whole Foods that the company needs to teach people how to shop?

Whole Foods, down 48% this year, also may be a victim of its own success. Even my humble neighborhood grocery store offers a pretty good selection of organic goods such as Earth's Best baby food and Kashi cereal. I even bought some wild Alaskan salmon on sale a few weeks ago. Why on earth would I need to make a special trip to Whole Foods or any other upscale grocery chain given high gas prices.

Even more troubling, according to The Times, is that interest in organic food is leveling off. This leaves Whole Foods in a real organic pickle. "...a big question for Whole Foods is whether even its core customers will continue to pay prices like $6.99 a pound for all-natural, air-chilled chicken breast or $12 for a bag of cherries," the Times says.

Many customers are probably saying goodbye to Whole Foods and hello to Wal-Mart Stores Inc. (NYSE: WMT).

Exxon Mobil Corp. (NYSE: XOM)'s record-setting quarterly profits last week prompted renewed calls for a windfall profits tax against the oil industry. The problem I have with these theory is that people usually do not explain what they mean by a "windfall."

"How does it differ from your everyday, run of the mill profit?" The Wall Street Journal noted in an editorial today. "Is it some absolute number, a matter of return on equity or sales -- or does it merely depend on who earns it?"

Also, is the government going to figure out how much Exxon deserved to earn and what gives the government the right to single out the oil companies for such treatment. Why not subject Google Inc. (NASDAQ: GOOG) or Warren Buffett's Berskshire Hathawy Inc. (NYSE: BRK.A) to a windfall profits tax too? They make lots of money, right?

Well, the reason why we don't penalize companies just because they make a lot of money is because that would be insane. As the Journal notes, it's hard to make the case that Exxon's profitability is excessive. In 2007, its profit margins were 10%, in-line with the industry average. The oil company's margins were worse than firms in the chemicals industry, pharmaceuticals, beverages and tobacco, the paper said.

Exxon Mobil is a pretty easy company to dislike. Its politics are reactionary, particularly on global warming. Its attitude toward alternative energy is skeptical. Wall Street already gave a thumbs down to its latest earnings report which is a far more effective punishment than a windfall profits tax.

Putting the squeeze on the oil industry may feel good, but it won't bring back $2 gas prices. Those days are gone forever.

Congressional Democrats, including Sen. Robert Byrd, D-W.Va, are pushing for the enactment of a second economic stimulus bill worth $24 billion, including a $6 billion lifeline for the beleaguered auto industry. Odds of it passing in a presidential election year are slim to none.

Democrats, though, are giving the people what they want. Regardless of whether it's a good idea or not, it's fantastic politics. Democrats can prove to voters, who are fed up with the lousy economy, that they "feel their pain," leaving aside the debate of whether it's needed.

That explains why House Speaker Nancy Pelosi, D-Calif., says that the second stimulus bill will need to have bipartisan support -- as the first one got -- because it is vital for the economy. Like the first economic stimulus plan, Byrd's bill will be temporary, targeted and provide disaster relief, according to CQ Politics.com.

"The Speaker earlier had vowed to enact a second measure, totaling at least $50 billion, before Congress leaves this year," the website says. "But the president and congressional Republicans have been less enthusiastic about the idea, repeatedly arguing that lawmakers should wait to assess the impact of the tax rebates and other incentives enacted in February."

Exxon Mobil Corp. (NYSE: XOM) today posted yet another record profit. The problem is that the results were not as fabulous as Wall Street expected.

Net income at the world's largest oil company surged 14% to $11.7 billion, or $2.22 a share, from $10.3 billion, or $1.83, a year earlier, the Irving, Texas-based company said in a statement. The results, which broke the company's previous record, trailed Wall Street expectations by a whopping 26 cents, according to Bloomberg News. They trailed the Thomson Reuters forecast by 25 cents. Revenue rose 40.4% to $138.07 billion.

The earnings were a mixed bag. The upstream business jumped 68%, while liquid oil volumes fell and natural gas production declined. Slumping margins pushed down profit at the downstream business by 54% and 32% in the chemicals business, according to The Wall Street Journal.

Even though Exxon Mobil is rolling in money, it's spending quite a bit of it as well.

Walt Disney Co. (NYSE: DIS) continues to defy skeptics, posting second-quarter profit that beat Wall Street expectations thanks to fee increases at ESPN and a robust business at the theme parks.

Net income at the second-largest media company rose 9% to $1.28 billion, or 66 cents a share, from $1.18 billion, or 57 cents, a year earlier. Excluding one-time items, profit was 62 cents, two cents better than Wall Street forecasts, according to Bloomberg News. Sales rose 2.1% to $9.24 billion. The stock, though, is down in after-hours trading for reasons that are not clear.

Among the highlights:

• Media Networks revenue for the quarter increased 8% to $4.1 billion and segment operating income increased 9% to $1.5 billion helped by growth at ESPN and the Disney Chanel.
  
• Parks and Resorts revenue increased 5% to $3.0 billion and segment operating income increased 3% to $641 million amid higher ticket prices and guest spending at Walt Disney World.
• Studio entertainment and consumer products showed declines amid lower box office receipts and the disappointing performance of "The Chronicles of Narnia: Prince Caspian."

Disney has so many ways of making money that if one business falters, the others take up the slack. That's why it remains the best managed of any media company and the one stock in the sector that remains a buy.

E*Trade (NASDAQ: ETFC) was fined $1 million by the Securities and Exchange Commission for failing to comply with federal anti-money laundering laws. The company, which did not admit guilt in the enforcement action, will pay an even steeper price over the long term, which is a good reason to avoid the company's stock.

What many investors and members of the press forget about government fines is that the dollar amount does not tell the full story. E*Trade will likely spend far more than $1 million upgrading its computer systems after it failed to verify the identities of more than 65,000 of its customers as required by SEC rules and the USA Patriot Act. Moreover, the company could face countless legal headaches from people whose stolen identities may have been used to set up phony E*Trade accounts. Let's not forget about the money laundering cases involving drug dealers and terrorists whose funding sources were not properly verified because of E*Trade.

The SEC, for one, has found no excuse for E*Trade's inaction to correct the problem, which it knew about for years.

Until recently, I believed that shares of Comcast Corp. (NASDAQ: CMCSA) had been unfairly punished by investors who were too skeptical about the company's prospects. Now, I am changing my tune because I have come to realize that the future of the company will be filled with endless pricing battles, which will force the Philadelphia-based cable giant to sacrifice the needs of shareholder to retain customers.

To be fair, Comcast reported a decent quarter Wednesday and was able to hold the line on capital expenditures. Net income was $632 million, or 21 cents a share, versus $588 million, or 19 cents, a year earlier. Sales jumped 11% to $8.55 billion. Results were short of the 23-cent forecast of analysts surveyed by Bloomberg but beat the $8.57 billion sales forecast.

Now, ordinarily missing the profit forecast would cause the shares to tank. Instead, they are trading up slightly because investors found much about the earnings report to like. For one thing, Comcast's free cash flow was $1.17 billion, more than triple from a year earlier. This beat the forecast of veteran cable industry watchers such as Craig Moffett of Sanford C. Bernstein. It also reaffirmed its earnings guidance for the year, countering worries that it would be hurt by cash-strapped customers falling behind in their bills.

Garmin Ltd. (NASDAQ: GRMN) shares are tanking today after the maker of personal navigation devices said that its new nuvifone will be delayed by several months. I would avoid this fad stock for a while.

The device, which the company had originally hoped to be available for the fourth quarter holiday season, will not be launched until the first quarter, according to a statement from the Cayman Islands-based company. Of course, the company tried to put a positive spin one the announcement.

"While we had hoped to have carrier launches in the fourth quarter, we have found that meeting some of the carrier specific requirements will take longer than anticipated," Garmin said. "We remain pleased with carrier interest in the device and are working toward making necessary design changes to meet their requirements. We anticipate launching the product during the first half of 2009."

First half of 2009? Nothing like setting a vague target that can easily be changed. And the company's problems don't stop with new products. Fewer people are buying the old ones as well. Garmin expects 2008 revenue of $3.9 billion, down from a previous estimate of $4.5 billion. Earnings per share are seen at $4.13, below its previous forecast of $4.40.

Benningan's, the casual dining chain where I had many bad dates, and Steak and Ale, a chain I never visited, have filed for Chapter 7 bankruptcy protection, underscoring how cash-strapped diners are not finding deals like unlimited breadsticks all that tempting.

The two chains, which are owned by billionaire John Kluge, have been in financial hot water for months, according to The Wall Street Journal. The paper reports that the chains were so broke that they did not have enough money to pay their employees for the rest of the week.

"Metromedia Restaurant Group (Kluge's company) earlier this year violated several terms of a lending agreement with GE Capital Solutions," the Journal reports. "It had been in negotiations with lenders for months to stave off the filing, while closing some stores and looking for a buyer, said two people involved in the matter."

Rising labor costs and soaring prices for food are killing casual dining chains. Cheesecake Factory Inc. (NASDAQ: CAKE) recently reported disappointing second quarter results, which featured the biggest drop in same store sales in the dining chain's history. Last year, activist investor Nelson Peltz acquired a 14% interest in the company. Brinker International Inc. (NYSE: EAT), owner of Chilli's Bar and Grill, and IHOP parent DineEquity Inc. (NYSE: DIN) are both down by double digits this year.

There is no hope for a turnaround in these companies anytime soon. Much like diners in these establishments, investors in these stocks are in for a world of indigestion.

Fox Business Network is a flop -- for now.

The News Corp. (NYSE: NWS)-owned cable channel is averaging just 8,000 viewers during the day and 20,000 during prime time, well under the 284,000 viewers who watch CNBC during the day and 191,000 who watch the General Electric Co. (NYSE: GE) network during prime time, according to The Washington Post.

Basically, Fox could attract as big of an audience yelling the news through a megaphone in the middle of New York City's Time Square. The poor performance is not a shock. CNBC has a huge advantage in terms of brand recognition and getting people to change their media habits is difficult even under the best of circumstances. Moreover, during periods of economic uncertainty people want to stick with tried and true sources of information rather than something new.

By the way, I am rooting for Fox to succeed. CNBC could use a kick in the pants. The network is so full of itself sometimes that it's painful to watch. Fox, though, has yet to knock CNBC off its high horse.

The Oracle of Omaha is shining a light on the presidential campaign of Barack Obama.

According to media reports, Warren Buffett is participating with Obama in a meeting about the economy along with Google Inc. (NASDAQ: GOOG) Chairman Eric Schmidt, former Treasury Secretaries Robert Rubin and Larry Summers and former Labor Secretary Bob Reich, according to CNBC. New Jersey Gov. Jon Corzine, a former Goldman Sachs Group Inc. (NYSE: GS) co-chairman, and former Federal Reserve Chairman Paul Volcker also will be at the meeting of the wisemen tomorrow. Buffett will be participating via telephone hook-up.

There is plenty to talk about given the current state of the economy and the housing market which the International Monetary Fund says shows no signs of recovery. Obama, the junior senator from Illinois, is clearly signaling not to expect much from the meeting.

``I expect some further fine-tuning of short-term policies based on what's happened over the last several months,'' Obama said in an interview with Bloomberg News.

What that means is not clear. It should surprise no one that Buffett is backing Obama. The investor has been critical of President Bush's economic policies including the repeal of the estate tax which he said would be a "terrible mistake." But that doesn't mean he agrees with all of Obama's policies either.

As CNBC notes, Buffett supported Hillary Clinton while she was running for president and disagrees with Obama's call to tax the windfall profits of oil companies and his decision to forgo public financing of his campaign. I guess the Omaha investor considers Obama to be a significant improvement over Republican John McCain.

Interesting how the greatest investor in history who Republicans tout as a champion of capitalism is as big of a Democrat as Barbra Streisand.

Verizon Communications Inc. (NYSE: VZ) today reported better-than-expected second quarter results, fueled by growth in its wireless and FioS TV and Internet customers.

Net income rose 12% to $1.88 billion, or 66 cents a share, from $1.68 billion, or 58 cents, a year earlier, according to the New York-based company. Sales rose 3.7% to $24.1 billion. Excluding one-time costs, profit was 67 cents, two cents ahead of the 65-cents expected by analysts surveyed by Bloomberg News. Sales were slightly below the $24.2 billion Bloomberg estimate.

"Our second quarter results were on track with our business plan, and top- and bottom-line growth remained solid," said Chief Executive Officer Ivan Seidenberg in the earnings press release. "We remain focused on steady improvements in revenue growth and productivity that will increase profitability and cash flows and create future opportunities to enhance shareholder returns."

Among the highlights:

• 1.5 million net customer additions for the wireless business;
• Wireless churn of 1.12%, 0.83% retail post-paid churn;
• 11.8 percent increase in total revenues; data revenues up 45.3%
• 176,000 net new FiOS TV customers and 187,000 net new FiOS Internet customers

Going forward, it will be interesting to see if consumers, who are already stretched thin, begin holding off on ordering FiOS even if the service is superior to cable. Also, will stressed consumers quit the service because they are worried about more pressing needs like their mortgage?